Gold price dropped, making its biggest limitation since October 2009, and silver fell to its lowest level in three months as the worsening European debt crisis that brought the commodity and stock markets weakened.
What happening in Europe is quite worrying. Plus, the strengthening of U.S. dollar is currently depressing the price of commodities, including gold.
Gold futures for February delivery fell 2% to survive to $ 1.564 on the COMEX in New York. Prices have fallen in five consecutive sessions, the longest fall since October 2009.
Most of the investors assessing market conditions are still minimal driving factors this week where the Gold is still focused on the European debt crisis situation and positive developments in the U.S. macroeconomic data that should be able to sustain demand in gold.
In the middle of thin trading volume today, the headlines that might drive the future of Gold is the Italian bond auction.
Recently reported European banking deposits on the ECB touched the highest record, amounting to 452 billion euros at the central bank. This condition indicates that there is a reluctance to lend to each other, which reflect the difficulty of funding even though the ECB has provided liquidity injections last week.
Above factors resulted in the value of the euro currency plunged along with gold commodity dropped below $ 1,555 so far with daily lows at $ 1,548.80, while the highest point was at $ 1,593.90 daily. The U.S. dollar index gained its own turn, which contributed to a negative catalyst to gold.
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